Portuguese Leaders Say It Would Be a Mistake to Kill Its ‘Golden Visa’ Program

Henrique Almeida, Bloomberg

- Nov 20, 2014 5:00 pm

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You can get EU citizenship if you have the cash for a really nice house? Where do we sign up (for both the citizenship, house, and cash)?

— Jason Clampet

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Portugal plans to continue granting resident permits to foreign property investors even after an investigation into the country’s so-called golden-visa program led to the resignation of a minister.

Ending this program “is a mistake that other countries which compete against us in exactly the same sector would take advantage of,” Vice Premier Paulo Portas said in parliament today. “One cannot confuse the tree with the forest.”

A probe into alleged corruption, influence peddling and money laundering linked to the issuance of golden visas led to the detention of 11 individuals for questioning, the Portuguese Prosecutor General’s Office said Nov. 13. Three days later the country’s Internal Administration Minister Miguel Macedo stepped down. He denied any wrongdoing.

Portugal’s golden-visa program enables non-EU citizens who invest more than 500,000 euros ($627,000) in real estate to apply for a temporary residency permit to live in the country and travel freely within Europe. Chinese investors are the top beneficiaries of the program, which has attracted 1.1 billion euros in property investment since it began in 2012, Portas said.

“I don’t think Portugal is in a position to throw away an investment of this size,” Portas said. The program has helped “bolster a sector that was completely paralyzed.”

Spain and Greece are among other EU countries with similar property-for-visa programs. While the practice has been heralded by governments in southern Europe as a much-needed boost to their economies, the European Parliament has voiced opposition to some of these programs.

In January, the EU Parliament approved a non-binding resolution stating that EU citizenship should not have a “price tag” attached to it. The document expressed concerns about programs adopted by some member states that “directly or indirectly” result in the sale of EU citizenship.

While Portugal’s golden visa program can be “improved and refined,” it shouldn’t be scrapped because it continues to be crucial for Portugal to attract “investment, generate growth and jobs,” Portas said.

To contact the reporter on this story: Henrique Almeida in Lisbon at halmeida5@bloomberg.net. To contact the editors responsible for this story: Jerrold Colten at jcolten@bloomberg.net.